Tue, Jan 20, 2026 page2

• KMT asks Cabinet to submit impact report

  QUESTIONS: The Cabinet must also answer where funding would come from, and how it plans to deal with the impacts and safeguard the competitiveness of the chip industry

  • By Lin Hsin-han / Staff reporter
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  The Chinese Nationalist Party (KMT) caucus yesterday demanded that the Executive Yuan submit a comprehensive industry impact assessment regarding a US$500 billion investment plan in the US.

  The Cabinet on Friday said the US has agreed to lower tariffs on Taiwanese goods from 20 percent to 15 percent, without stacking them on existing most-favored-nation rates, and to grant the nation’s semiconductors and related products most-favorable treatment under Section 232 of the US Trade Expansion Act.

  The deal includes a pledge that Taiwanese semiconductor and technology companies would invest at least US$250 billion in the US, and an additional US$250 billion credit guarantee from the government for other investments.

  

  From left, Chinese Nationalist Party (KMT) lawmakers Lin Pei-hsiang, Lo Chih-chiang, Lai Shyh-bao and Wang Hung-wei hold placards during a news conference in Taipei yesterday.

  Photo: Liao Chen-huei, Taipei Times

  In response to opposition parties’ concerns that Taiwan is trading US$500 billion in investments for a reduced tariff rate, Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said the US$250 billion company-led investments and the credit guarantees are different forms of capital, and that lumping them together was like comparing “apples with oranges.”

  Unconvinced, the KMT caucus demanded that the Executive Yuan submit a comprehensive industry impact assessment report.

  The report must include the deal’s its impacts on Taiwan’s GDP, the semiconductor supply chain and the labor market; spillover effects on small and medium-sized enterprises (SMEs), and traditional industries; and an assessment of national fiscal and financial risks, the KMT said.

  The KMT caucus also demanded that the Executive Yuan answer three questions, and submit the full details of the negotiations to the Legislative Yuan for formal review and oversight.

  First is where the funding for the credit guarantees would come from, and how associated risks would be managed and controlled.

  Second, the Cabinet must answer how it plans to safeguard the core competitiveness of the semiconductor industry, as the government had promised to keep advanced chip manufacturing processes in Taiwan, but the deal would shift 30 percent to 40 percent of production to the US.

  Third is to explain how the deal would impact SMEs, traditional industries and domestic job opportunities, as well as how it plans to deal with the impacts.

  KMT caucus secretary-general Lo Chih-chiang (羅智強) said that half a century ago, the KMT-led government had planted the “great tree” of Taiwan’s high-tech industry for the benefit of all citizens, but now the Democratic Progressive Party (DPP) government is not only enjoying the shade under this tree, but has also begun to chop it down.

  Now, it is not only Taiwan Semiconductor Manufacturing Co (TSMC) that is moving away, but the entire high-tech supply chain, he said, adding that in five, 10 or 20 years, “the great tree will be gone.”

  “What will become of Taiwan’s next generation by then?” he said, adding that he found it difficult to understand how the DPP government could gleefully cheer for the result of the trade negotiations.

  KMT Deputy Secretary-General Lin Pei-hsiang (林沛祥) said the US$500 billion investment by Taiwan in the US semiconductor industry is equivalent to more than 60 percent of the nation’s annual GDP.

  “Who will shoulder the risk of such a massive guarantee, and who will be held accountable if the investments fail?” he said. “This is not ‘reciprocal cooperation’ [with the US], but a substantial hollowing out of our country.”

  That is a national security crisis far more perilous than the declining birthrate, energy shortages or even cross-strait relations, Lin said.

  KMT caucus deputy secretary-general Wang Hung-wei (王鴻薇) urged the government to address the impact of the massive investment, as it should not crowd out domestic investment.

  With 40 percent of Taiwan’s “silicon shield” — TSMC — about to be relocated to the US, the government must face the issue of securing the future employment of 300,000 semiconductor industry workers, she said.
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